The tyranny of the set-top box.

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Apple TV has been a persistent loser from a company that usually only tolerates winners. It's clear that Apple wants to do something "in the living room," but damned if it can figure out exactly what that is. Yesterday, Apple took another run at this thing, announcing an "all-new" Apple TV.

As with any new electronic gadget, I must be of two minds about the new Apple TV. The first, most difficult question is, will the new Apple TV be a successful product for Apple? The second question is easier: is this a product I want to buy for myself?

For any consumer electronics product, the degree to which those two questions have the same answer is dictated by—for lack of a better term—one's geekiness. Mine is substantial. I have not wanted any of the Apple TV products (including the one released yesterday), and thus far, none of them have had much success in the market either. But does that mean that an Apple TV designed to my specifications would be a hit? The easy answer is, probably not.

But pondering the prospects of a cheaper, smaller, streaming-only, renting-only, iOS-based Apple TV device in the rumor-filled weeks leading up to its announcement yesterday has changed my mind. In this particular case, I think my desires are actually very well aligned with the mass market—and continue to be at odds with the products Apple has decided to create.

This ain't no disco

It seems to me that Apple has been trying to recreate the success of the iTunes Music Store with its Apple TV efforts. Success in the digital music market had a familiar set of requirements. The experience had to be easy, the content had to be there, and, of course, the price had to be right. Apple knocked these down one at a time with iTunes, starting out as a Mac-only product, adding a hardware component to ensure a smooth end-to-end experience, and getting content owners on board with a combination of guile ("Hey, it's only available to Mac users, a tiny percentage of the market. If things get out of hand, at least it'll be contained, right?") and trademark Steve Jobs persuasion ("Do you want to sell sugar water for the rest of your life, or do you want to come with me and change the world?")

That worked for music because Apple was first on the scene. Legal digital music sales that non-geek customers could understand and use successfully didn't really exist before Apple's iTunes/iPod combination arrived. Apple had time to grow its music business organically, with very little competent competition. The end result for consumers was simple, comprehensive access to almost all the content they wanted, at prices they found acceptable.

The landscape in the living room is very different. It's not a green field where Apple can plant its digital seeds and grow them into a beautiful walled garden. It is, to use Steve Jobs's own word, "balkanized." Even before Apple dipped its toe in the water with the first Apple TV in 2006, the living room was a battlefield scorched by decades of competition between broadcast networks, cable and satellite providers, and a whole raft of consumer electronics makers.

Apple's failure to recognize this reality has been and continues to be the root cause of Apple TV's woes. Pulling an iTunes—creating a "flagship" experience that comes to define the entire market—is nearly impossible to do in such a crowded, well-established market, but Apple seems determined to keep banging its head against this wall.

Make it simpler, stupid

What I want, and what I believe the market needs, is a way to simplify the byzantine world of TV and home video. You can't do this by pretending that the rat's nest of cables, contracts, and TV-connected devices in all our lives doesn't exist. Apple's job is to tame this mess, not ignore it.

Consider traditional cable TV. For a flat monthly fee, it provides unlimited access to programming on a huge number of channels. Pay a little more per month and progressively more sophisticated content becomes available. And all this is before even considering the on-demand/pay-per-view options.

No one person can watch all TV programming a cable subscription offers, and the mandatory bundling of channel "packages" often grates on consumers (though it pays for a lot of the less mainstream content that geeks love). But the bottom line is that most people have one or two TV shows that they're not willing to part with. Any living room "solution" that doesn't offer a way to view that hot serial drama on the night it airs or a favorite soap opera or that obscure cooking reality show your dad is obsessed with will never be a comprehensive solution. Instead, it just adds to the giant mess hanging off the back of the TV: another expense, another device, another remote, another headache.

Cable TV is just the tip of this iceberg. Repeat this situation for all of the other existing sources of video content—satellite, the Web, Netflix, Amazon, home video from camcorders, and yes, even illegal downloads of content that no one is yet willing to sell to you in a timely manner. Consumers are drowning in complexity; we need help!

The solution is a device that is unabashedly omnivorous. Yes, in traditional Apple fashion, it must provide a simple, elegant, user interface. But behind the scenes, it must be willing and able to accept content from as many sources as possible. This is what makes the device valuable and desirable: dealing with and hiding all this complexity!

Is this show on cable? Satellite? Downloaded from the Web? Streamed from Netflix? Is it on my Mac? My iPhone? Does it need to be transcoded? Upscaled or downscaled? These are the things geeks deal with manually right now, and regular people have little chance of figuring out. People will pay for a device that will handle all of this for them. It might take a while, but word would get around about the new device that actually makes your living room less complex, for a change. One box to rule them all.

If it were easy, everyone would be doing it

Apple has the technology and the expertise to create such a device. But as Steve Jobs made clear with his remarks at the D8 conference in June, he doesn't believe a product like this can compete with subsidized set-top boxes and still make a profit. "All you can do is add a box onto the TV system," Jobs laments. "You just end up with a table full of remotes, a cluster full of boxes, a bunch of different UIs, and that's the situation we have today."

The solution? Jobs continues: "The only way that's ever going to change is if you can really go back to square one and tear up the set-top box and redesign it from scratch with a consistent UI across all these different functions, and get it to the consumer in a way they're willing to pay for it."

He's close—so close!—to having the right answer. He was, in typical Jobs fashion, obliquely teasing the new $99 Apple TV device that would be released a few months later. Where he went wrong was in entertaining the fantasy that you can ever "go back to square one" or "tear up the set-top box." That ship has sailed.

Furthermore, no gradual roll-out of content deals is ever going to give Apple TV the sales volume it needs to accelerate the progress of those deals, regardless of the price of the device. Content owners are now too savvy to just give Apple the kind of power it managed to attain with its iTunes music business; they're dedicated to preserving the "competitive landscape," ensuring that no one device manufacturer or online service becomes dominant. The end result for consumers is a preservation of the status quo: confusion, complexity, chaos.

The only realistic solution is to make an end-run around the existing players. Instead of trying to establish yet another isolated beachhead, accept and absorb all available content by any means necessary and concentrate on providing a unified interface to all of it… Apple-vended content included, of course. Win the consumers' hearts and minds first by being the hero they need to save them from the current mess surrounding their TV. Win all those other content deals later, once everyone has your device in their living room. Step three: profit.

This is necessarily a long-term strategy—no iPhone-like sales curves here—but it's founded on a consumer-focused approach that Apple frequently claims as a core principle. Put aside short-term business and "go-to-market" concerns and focus on the problems people actually face in the living room.

Apple needs to accept the things it cannot change and have the courage to change the things it can. Perhaps consumer reaction to this latest Apple TV device will finally give Steve Jobs the wisdom to tell the difference.

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John Siracusa
John Siracusa has a B.S. in Computer Engineering from Boston University. He has been a Mac user since 1984, a Unix geek since 1993, and is a professional web developer and freelance technology writer. Emailsiracusa@arstechnica.com//Twitter@siracusa

I have a Mac in the office and a home theater in the living room. Ethernet connects them.

What costs $99 and runs Plex9?

Plex is free, but it needs hardware to run on, hardware that supports HD. A mini is the best choice, but that's a good deal more expensive than an AppleTV. While the software itself is free, the hardware you need to purchase and deploy in order to take advantage of Plex's greater functionality more than makes up for the difference.

If you happen to have spare hardware, or your main viewing area is the same as your main computing area, then there's no issue. However, I am not sure that describes the majority of users, or indeed the target market for the Apple TV.

Most of the comments are missing the points. This model and the previous ones are essentially market research for Apple. No one has been able to come in and do what Apple did with the iPod (dominate the digital player market) or even what they did with the iPhone (muscle into a huge, mature worldwide market and become a major player without any prior experience). The set top market still looks like the MP3 player market did before the iPod was launched, with the added complication of ties to cable providers.

Apple is attempting to do an end-run around cable providers, by using your existing transport network (your ISP) and some combination of hardware you may already have (Macs, Windows PCs running iTunes, iOS devices) and some new, interconnecting piece of hardware (the AppleTV) in order to become the new middleman between content producers and content consumers.

This task is more complicated than the previous two, if not outright more difficult. Incumbent silos are more rigid, and since content producers are now fully aware of Apple's intents and capabilities, they are more wary.

The kind of fantasy scenario many users here cite-- a la carte pricing for tv programs/channels at reasonable rates for purchase, unencumbered by DRM-- is just that, a fantasy.

Right now I see Apple experimenting with the hardware much in the same way that MS did with the initial incarnations of the Xbox and Xbox360. The Xbox had a standard built-in hard drive that all developers were supposed to use. The 360 had models with and without. Apple did the same. Obviously the original was not a runaway success, but unlike the Cube, they did not kill it immediately. They are now experimenting with a different model: no local storage, cheaper price point, dependant on Internet streaming, iTunes streaming, and a rental model. They'll likely keep selling it even if it also not a big hit, to collect information on how people react to it and how they use it, to see if they can use that information to come up with a better model later.

What I don't see is there being any real time pressure. I've played with a lot of different boxes and software media centers: XBMC, Boxee, Plex, a bunch of hardware players based on Syabas, etc etc. None comes close to combining a rich feature list with a level of sophistication and ease of use the way an Apple product does. Boxee comes closest. We'll see how that new Apple TV fares against the Boxee box this fall.

Personally I'm content with a mini-pc with customized software built into it to access anything that is online. I'm not a fan of paying a buck per episode, I'd rather stream with commercials or rent a service like netflix so you won't ever find me using an AppleTV for the very reason that you can find anything on that system and more by using a PC.

If they really want to sell AppleTV I think they should strike a better deal with their consumers than what they currently offer.

Apple could make a splash by outbidding every onefor NFL rights the next they come around and then also putting the games on the ATV. That would mean Apple could do something original with NFL games. Hide the tickers if you want. Instant scores. Store footage and mark it for instant replay during the game etc. That's what Apple has to do. Become a content company to at least jumpstart the transition. AFter that they can sell off the content. They have $40 billion and counting in the bank.

This is yet another instance where it doesn't matter what you get, how good it is, or how much it costs- all that matters is what team you're on. There are so many solutions out there that give you anything you want, whenever you want it. That isn't the issue anymore. The critical element in the market today is brand loyalty. You're either for or against a product's maker/fanbase/ecosystem. That and that alone will determine whether you buy into something. Most Apple users don't watch much TV on an actual television. Apple did away with this years ago along with YouTube, Netflix, Amazon and Hulu. Now it's trying to get into the market of people who still actually watch content on a TV. These people aren't the typical Apple user base, and that is why they're having a hard time. It has very little to do with the product.

Ceton is now shipping a 4-tuner CableCard tuner, and ATI has had one for a while. With a Blu-Ray equipped computer and the Ceton tuner card, you can view and record digital cable, and you can view every type of rentable, streamable, and purchasable content. And you don't have to pay for box rental or DVR service (aside from the cost of a CableCard.)

The trouble is that it costs around $1000 to do all this: you need a decent computer with an nVidia or AMD graphics accelerator, which costs a minimum of $400. You also need at least one tuner. An analog or hybrid tuner will cost a minimum of $100, and a CableCard equipped tuner will be $200-400, when you can actually buy one: the Ceton card is back-ordered, the ATI is hard to get, and the SiliconDust tuner is still MIA.

The only thing this setup can't do is watch cable-company VOD, but if I can get anything on VOD through some other means, what's the point?

Not to mention that, assuming you can get all the hard to find hardware and set it up correctly, you are still left unable to, say, watch a Blu-Ray movie without using a dedicated, proprietary and paid for software viewer. There still is no commercial operating system with blu-ray playing built in. None. Nada. So you see the problem when you are trying to create/configure something that is supposed to act as a front end to all this. If it needs to interface with 3rd party software to play a BD movie then it becomes increasingly complex and not easy to use/configure, that's if you can even have the front-end interface use said player.

And don't get me started on TrueHD audio playback. (whatever 'HD' means in regards to audio)

as much as i enjoy new tech in video and audio i still have to work.and my job for the last 16 - 18 years is the backroom worker for my friend's videostore Videoport in portland, maine.yes i would much rather see people get off their couch, socialize, and come on down to pick out some movies together.keep retail alive in your local economy.many folk depende on their jobs.

This is yet another instance where it doesn't matter what you get, how good it is, or how much it costs- all that matters is what team you're on. There are so many solutions out there that give you anything you want, whenever you want it. That isn't the issue anymore. The critical element in the market today is brand loyalty. You're either for or against a product's maker/fanbase/ecosystem. That and that alone will determine whether you buy into something. Most Apple users don't watch much TV on an actual television. Apple did away with this years ago along with YouTube, Netflix, Amazon and Hulu. Now it's trying to get into the market of people who still actually watch content on a TV. These people aren't the typical Apple user base, and that is why they're having a hard time. It has very little to do with the product.

I think you are right about brand ecosystem, and I fit your description of an Apple user that doesn't watch much TV, but I do have Apple TV already, I love being able to watch a few shows now and then without commercials and I don't mind paying for that priviledge. I bought the new Apple TV because it seems like a major improvement in the product and for my "ecosystem" it fits in with the rest of my Apple products.

All of this criticism reminds me of the shouting about the iPad when it was first announced.

"Who wants one of those? Just buy a netbook!"

3 million+ iPads later...

Apple's market is not geeks. It isn't. There are lots of geeky things to love about Macs and iPhones and iPods, but they make money on hiding complexity. Complexity that arguably shouldn't be there in the first place.

They're trying to make appliances. This is a TV appliance. To operate it, you need opposable thumbs and enough wherewithal to work a credit card. You must also understand how to plug in a maximum of 3 cables.

I've got an iMac, a macbook, a PS3 and an XBox 360 all ready to put content on my TV if I want. I currently use MediaLink to stream content to my PS3 (Plex had too many problems; $20 saved me a lot of headaches), and I used to have an HDMI cable going directly from my iMac to the TV until I got the PS3 and decided that was more important. I can do all this stuff, and I think it's a big friggin' pain in the ass.

I LIKE paying for content. I don't have a cable TV package because it chews up time that I don't have. I procrastinate enough as it is without always-on distracting media being available. There are still a few shows that I like to watch, though, and getting them legally is a hassle if you don't have a subscription and you don't want to wait for the DVDs to come out. (I usually compromise by buying the DVDs when they do come out, but relying on torrents in the meantime. Also, since I live in Canada, many of the useful legal options aren't available to me.)

I'm too lazy to walk to the corner video store to rent movies, but I still like watching them now and then. So Apple has a device that lets me pay for content at a rate I find more or less acceptable – and let's face it, there's a lot of TV that I'll watch once and never again – and it lets me be lazy, and I don't have to deal with any more complicated setups?

I take back part of my statement that Apple doesn't make things for geeks; they make things for TIRED geeks. I used to run Linux and FreeBSD and maintain my own mail server, etc., etc. I finally got sick of doing my admin job at home and started buying Macs so I didn't have to worry about the day-to-day stuff anymore.

I realize that this is Ars Technica, but we have to stop thinking like Apple is doing this FOR US. They've got a really different demographic in mind. Any time you stop thinking that, think back to the nerdrage that accompanied the iPad release and how popular that ended up being.

For 100 bucks, if I can use this device to basically watch content on the web with little restriction it is a slam dunk. The movie rental is just added bonus.

It is not worth it if it is just NetFlix and YouTube. I want to be able to go to any website. If it comes with a web browser (which I am not sure that it does) then I would get it for that alone. More research required...

Folks ... "TV" itself as an industry is in big trouble ... just as the old-fashioned music industry is in trouble. The root cause of both 'troubles' is that rapidly-expanding means of conveying and distributing (and pirating) content are destroying the profitability of the old-fashioned vertically-integrated mega-businesses which depended on the fact that customer's choices were limited. The consequence was that you could achieve true mass markets for carefully pablumized mass pap.

The 'gadget' used to 'watch TV' isn't the game here ... it's the business/distribution model. Writing an article about how Apple 'needs' to make something which can obtain any and all content and simplify this acquisition for the customer ... that's truly "Three dicks and the Rockettes for free" thinking ... Apple can't do that because Apple doesn't have the clout.

The 5 pages of comments/arguments on this topic is pretty enlightening: we watch television (or perhaps it should be "consume visual media") in incredibly diverse ways. This tells me that it's going to be a while, if ever, before someone can create a device and/or service that encompasses everyone's needs and preferences.

As has been pointed out many times, Ars readers do not represent the average consumer when it comes to electronics. Most people are well served by their cable/satellite set-top boxes. A guy comes out with all the necessary equipment, sets it up, gives a very brief tutorial, and you're done. You change channels the same basic way you have for 50 years.

I currently use a system comprised of xbox 360's, a Win7 desktop that records OTA, and a hard drive full of our ripped DVD library that streams to the xbox's. We use the hell out of Netflix streaming. The xbox's each have an Airport Express for wireless and I use an Airport Extreme, so I'm neither an Apple fanboy or hater - I used whatever I feel is the best piece of equipment for my needs (balanced with price).

If Apple included DVR functionality for OTA content I might considered ditching my xbox/win7 setup for the Apple TV. Maybe. I might even consider it if they sold this functionality in a second piece of hardware (I don't own any Apple computers - so something like the EyeTV wouldn't work for me, I don't think).

I would buy it if it has a CableCard tuner and built in storage or option to attach external storage. If this device can't replace my Cable DVR, I don't need extra clutter. I can get movies and shows in HD for the same price (or less) from my Cable provider.

The solution is a device that is unabashedly omnivorous. Yes, in traditional Apple fashion, it must provide a simple, elegant, user interface. But behind the scenes, it must be willing and able to accept content from as many sources as possible. This is what makes the device valuable and desirable: dealing with and hiding all this complexity!

Is this show on cable? Satellite? Downloaded from the Web? Streamed from Netflix? Is it on my Mac? My iPhone? Does it need to be transcoded? Upscaled or downscaled? These are the things geeks deal with manually right now, and regular people have little chance of figuring out. People will pay for a device that will handle all of this for them. It might take a while, but word would get around about the new device that actually makes your living room less complex, for a change. One box to rule them all.

That is no solution at all. I don't buy it for a second that consumers will line up to pay for and subscribe to Cable, Satellite, Netflix, and also buy or rent stuff through iTunes, Amazon, and other sources if only they all worked behind a unified interface. No unified interface is worth several hundred dollars in fees to get service from all these vendors.

People already subscribe or otherwise pay for one or more sources of content. That was the point of the part about the dad being obsessed with that one cooking reality show and so on. (Sports is another good example, brought up by commenters, of content that fans already get in some way, and that's usually locked up tight in existing contracts.) People already pay for the content they want, in one form or another. Yes, Apple can offer some of the same content for a different price or in a different way (i.e., rentals), but since Apple (or anyone, really) can't offer all the content available elsewhere, the only way to avoid adding to the giant mess attached to the TV is to choose to unify all the existing content sources (including Apple's own) under a single interface. That is just about the only thing that would be worth "several hundred dollars" (though the actual price of the hardware could be much lower with more creative business arrangements with content owners or a clever use of server-side computing power and storage).

This argument has popped up before, and the answer has always been the same; it's going to be a lot more expensive for consumers to buy 5 channels than 500. The problem is that niche networks don't get enough eyeballs on their own to bring in enough advertising dollars or subscription fees to support their content. If they stopped being part of the package that everyone has to buy, they'd have to seriously jack up what they charge to the providers, which will result in either the network not being carried or cable bills going through the roof.

I would LOVE to buy AppleTV now. In fact, I wanted it before, I just needed the HD to make it work.

So Apple is taking their time getting somewhere, and they realize this market just needs something out there to eventually take, as in reach a critical mass...and BOOM. AppleTV will get into homes because people want a simple experience, which Apple will deliver, bit by bit. And when Apps show up with content (apps like FLEX or BOXEE) and Apple flips the switch... problem solved.

This article doesn't show reveal any understanding that Apple is doing what it needs to do... open up the door just a hint for apps (like Netflix) to show. And I'd rather buy an AppleTV to get everything together in one place (HELLLLLO? that's what it is! The article portrays it as not good enough... OF COURSE. It needs time. Apple is focussing on what it can sell now, which is Netflix (HUGE) and content off iDevices in the room (HUGE) and TV shows (yeah, you can get 'em with your cable... but now, if you miss recording it, for a buck, RENT AND ENJOY.) Post script: (oh, yeah... HD movies...)

They know what they're doing. AppleTV WILL take over the living room as the omnivorous object that this article claims was missed.

Normally I love your stuff, but this analysis seems rather confused. Sure, by iDevice standards, Apple TV has not been a runaway success. But I'm not sure how selling millions of units of a device considered a "hobby" is a failure. You're also not taking into account how we who have Apple TVs LOVE them, are hooked, and are great guinea pigs for Apple to help them make future iterations more successful.

>>He's close—so close!—to having the right answer. He was, in typical Jobs fashion, obliquely teasing the new $99 Apple TV device that would be released a few months later. Where he went wrong was in entertaining the fantasy that you can ever "go back to square one" or "tear up the set-top box." That ship has sailed.<< There's this little thing called the "internet," John, which you didn't even mention.

You're right. Apple's far from winning in this competitive market. It won't be easy. But the stakes are huge, so unlike other markets where they'd only enter when they could dominate it, Apple had to plant their flag in the ground and slowly grow their capabilities as time goes by and the competition evolves. Netflix is going to be huge for them. As will an Apple TV app store, if they ever decide to do that.

Cable TV is just the tip of this iceberg. Repeat this situation for all of the other existing sources of video content—satellite, the Web, Netflix, Amazon, home video from camcorders, and yes, even illegal downloads of content that no one is yet willing to sell to you in a timely manner.

I see what you did here.. ignore a large source of free content that is legal: OTA TV probably because you dislike it. It is relevant to the discussion because I'm not alone in saying that if the appleTV had DVR capabilities it would have been on my list well before building a HTPC was.

Cable TV is just the tip of this iceberg. Repeat this situation for all of the other existing sources of video content—satellite, the Web, Netflix, Amazon, home video from camcorders, and yes, even illegal downloads of content that no one is yet willing to sell to you in a timely manner.

I see what you did here.. ignore a large source of free content that is legal: OTA TV probably because you dislike it. It is relevant to the discussion because I'm not alone in saying that if the appleTV had DVR capabilities it would have been on my list well before building a HTPC was.

I didn't omit it intentionally (in fact, I thought I'd included it until I re-read the bit you quoted). Of course it should handle OTA TV as well. And yes, to handle existing broadcast TV (cable, OTA, etc.) requires some sort of DVR-like functionality (though it could be server-side, technically speaking, and not necessarily a hard drive in or connected to the box itself).

As usual, we the geeks are an impatient bunch and want everything yesterday. Realistically this is a classic Apple approach: Hit the high points well, release, then iterate. The geeks screamed bloody murder that the original iPhone didn't have apps. Nevertheless it was better than everything else on the market at the time, and that very same hardware DID get apps (galore!) in future software iterations. Same thing with the iPad - It's just a big iPod Touch! But it's very well suited to the non-geek users which is why it's sold so well thus far.

I think the new AppleTV is a disappointment to geeks who could see the grander vision, but for the average Joe it's a very simple and inexpensive device that hits the high notes they care about most.

Apple TV has been a persistent loser from a company that usually only tolerates winners. With the latest iteration of the product, Apple hopes to change its fortunes. But is it still barking up the wrong tree?

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John, you are just wrong on this one. This is the Apple TV for which I've been waiting.

Nonsense. You're just a blithering fanboy.

There was nothing keeping Apple from bringing Netflix to the old AppleTV. The bulk of this release is just a seemingly gratuitous platform change and a price drop. For the most part, it's just more of the same. At a technical level, it is more of the same even if "consumers" can't see it.

1) The AppleTV does far more than play tv shows & movies. The entire "secret" of this device is hidden under video "podcasts"... there are endless 1000's of cable shows, comedy, pbs, news, etc... all for free! The AppleTV also wirelessly streams all your music through the house, also photos, movies, on and on...

2) The ATV plays any modern content from your Macs or other devices.

NO IT DOES NOT.

The ATV is just a glorified ipod/ipad.

That means it can't handle playback of an American HD broadcast. It can't handle playback of a UK HD broadcast. It can't handle playback of a BluRay disk/rip. It can't handle a cable recording made with an HD-PVR or Elgato EyeTV HD.

It probably can't even handle grandma's home videos in SD MPEG2.

It's barely more capable than the old ATV in terms of "accelerated" content and woefully underpowered compared to any thing else.

"Is this show on cable? Satellite? Downloaded from the Web? Streamed from Netflix? Is it on my Mac? My iPhone? Does it need to be transcoded? Upscaled or downscaled? These are the things geeks deal with manually right now, and regular people have little chance of figuring out."

Where this goes wrong is that it assumes that regular people KNOW or CARE about these things. Upscaling? That's not even a word in their vocabulary. For 90% of people, the only question is 'Can I watch what I want at a reasonable price?' The conversation ends there.

The AppleTV answers this question, one way or another. A person will look at the content and the price and say either 'yes' or 'no', and that's all. These supposed missed 'high notes' exist outside the realm of what average consumers bother themselves with.

As people get more technical, they may find the AppleTV doesn't suit their needs because they have more questions for which the AppleTV is incapable of providing an answer, but as I said before, this device isn't for them.

The Roku HD box is 99 bucks for 1080p with Netflix plus a few others.The Boxee HD box is 199 bucks 1080p with Netflix and Hulu plus a few others.AppleTV is 99 bucks for 780p with Netflix plus a few others and better synced to your Apple crap.

The Sony TV I just bought does 1080p, and has a built in netflix client, a built in amazon VOD client, a built in youtube client, and a built in Hulu Plus client, plus a whole lot of other services I never heard of. And it supports media streaming from any and multiple DLNA/UPnP media servers, which Windows Media Center happens to be. And since Windows Media Center on Windows 7 does automatic transcoding, anything that plays on windows, will be streamable to my tv.

It's also software upgradable, because on the video menu, there is an icon for "Hulu Plus", which wasn't there when I bought the TV, and it says, "Coming Fall 2010" in small letters next to it.

I used to have a PC connected to my old TV, but when that TV broke, and I bought this one, I no longer need to connect my PC to it.

"Is this show on cable? Satellite? Downloaded from the Web? Streamed from Netflix? Is it on my Mac? My iPhone? Does it need to be transcoded? Upscaled or downscaled? These are the things geeks deal with manually right now, and regular people have little chance of figuring out."

Where this goes wrong is that it assumes that regular people KNOW or CARE about these things. Upscaling? That's not even a word in their vocabulary.

Upcaling may not be in most people's vocabulary, but I'm pretty sure "Wow, that looks like crap!" is. HDTV is not exactly a niche market these days.

They don't know what "transcoding" means either. All they know is that the device must be broken because some of their files won't play.

The other parts are just of the form "will it play this"? Normal people understand questions like "Will it play Netflix and Hulu?" and "Does this give me yet another channel selector to fool with, or can I get rid of some of my other ones (cable, satellite, OTA, DVR) and just use this?"

RealityMonster wrote:

For 90% of people, the only question is 'Can I watch what I want at a reasonable price?' The conversation ends there.

The AppleTV answers this question, one way or another. A person will look at the content and the price and say either 'yes' or 'no', and that's all. These supposed missed 'high notes' exist outside the realm of what average consumers bother themselves with.

I think "Will this simplify my life or just make it more complicated?" is a question even more likely to come from the general public than from geeks.

Edited to add: this isn't even a swipe at the Apple TV particularly. Apple can answer yes to some of these questions -- especially since pretty much anything that will play in iTunes will play on an Apple TV. That's really easy to understand.

Its quite clear Apple wanted to deliver a bunch of on-demand programs available for a fixed monthly price. The networks refused.

Apple cannot do what they want in the market because the networks are not willing to take risks. The difference between this and the music market is that it wasn't a big risk for the record labels (iTunes was originally mac only allowing them to use it as a test run).

This is it. The networks make a lot of money off cable subscriptions and advertising revenue. Amazon cutting prices so low to keep/win marketshare is not going to endear them to the networks if it makes consumers think everything on the internet should cost 99 cents.

Apple got what they could and decided to run with it. Having the product out there will probably entice more networks to sign on, especially the smaller ones with niche content.

From the WSJ today: "According to Screen Digest, Apple accounts for 57% of trasactions in internet video-on-demand movies on a number of sales basis, and 53% of tv shows, excluding sports."Amazon is only 5% and 6%, respectively. Microsoft and Sony both sell more online video than does Amazon through their game consoles.

Selling tv shows on the internet will make $407 million in 2010 while traditional tv ads and subscriptions will rake in $143 billion.

"The only realistic solution is to make an end-run around the existing players. Instead of trying to establish yet another isolated beachhead, accept and absorb all available content by any means necessary and concentrate on providing a unified interface to all of it… Apple-vended content included, of course. Win the consumers' hearts and minds first by being the hero they need to save them from the current mess surrounding their TV. Win all those other content deals later, once everyone has your device in their living room. Step three: profit."

It seems to me that there is already such a box -- Tivo. It pulls in content from cable and the air. It streams and downloads content from a lot of sources, including digital purchase and rentals from several sources. Excepting tjat Tivo's servers being so slow that some of the network services are utterly unusable, it is a really nice solution. The things that work well work really well and that covers a pretty broad domain.

As much as I love my Tivo, though, I would say that as a business they are very close to failing ... and they're failing because the device is just too expensive. Even if they gave the programming guides away the device is still too expensive to go mass-market against rented set-top boxes. The grand unification device is not competitive, period.

Apple's idea of selling the box really really cheap is about the only thing that stands a chance. If it does an exceptional job of streaming even just movie content (NetFlix) then that plus the stream-my-MP3s-to-the-AV-stack feature is enough to justify $100 easily to me. I think that over time Apple will accumulate accessibility to more and more content, and every step they take makes it more likely I can cut the cable, so to speak.

I think they stand a chance in a number of respects. First, I would love to play my huge archive of music in iTunes through the TV. I can do that a few different ways, but all of them are annoyingly hard to use in a way that my iPods aren't (and for no reason I can discern). Automatic discovery, a slick UI, and *cheap* are all things I can totally dig.

Second, I'd like the same thing for my movies. I have many, many DVDs and would love to be able to rip them and stream them. The solutions that do that are much less numerous than for music, and usually have even worse interfaces. I can totally see using such a device as a DVD access system.

That's before we even get to online content. Would people pay $100 for a very simple device for Netflix access? I think they probably would and will, even independent of other things. This is in fact the #1 thing I'd like to do with the device.

As for content through Apple, it's certainly an uphill battle getting a lot of mainstream content (although they got a couple big ones already, and that's more than I expected) but there is just tons of niche content. The long tail can work for such a device. Would you pay for access to all of the BBC's content? Sports streams you cannot get from the cable company? I think there is a lot of such content that has little or no competition from the cable companies that would fit Apple's model very well.

So Apple's got a device with an internet connection on one side and HDMI on the other. It doesn't get much simpler than that. It has several different usage models that might appeal to different people, and a very nice UI. And it's pretty darn cheap. The only reason I don't have one already is that I only have one DVI input on my TV, and it's not a $100 decision to fix that. Soon, though....

Having watched the Keynote, I was impressed by Apple's list of issues given by previous owners, that it attempted to address with this iteration (it is important to note that apple produces "iterations" to be built on... or left behind, as in the case of the previous Apple TV). Why did you not address those in your analysis?

Simplicity, low cost, small size, stealth-Black, ease of use, easy connection, lack of storage or cataloging. This iteration seems perfect for the time being...

As long as Cable TV does not provide a la carte programing, and I am forced to purchase a bundle of garbage (hollywood gossip, wrestling, big brother & reality game shows, tv hawking, and reruns) for the OCCASIONAL show that I may want to watch, I see this box as a gleaming sliver of light. Drop Cable's mid tier bundle of $50 a month, keep the internet & netflix $8... and rent the occasional desirable show- even budgeting $10 a week for rentals, it will be less than what I Don't watch on cable.

But I am in the minority (maybe a minority)... our family reads. We get our local news from dead tree publishing's Newspaper, and World news from NPR or BBC and NYT on line. Currently, we watch about 1 hour of TV a night (prior to 9 PM) and NONE if we have a DVD from NetFlix to watch. I hate the repetitive commercials, but am not so enthralled with the actual offerings to learn to DVR them just in order to avoid them. I also hate the juggling of various remotes... looking forward to using my phone as a remote with Apple TV, and at $100 it is little more than a Harmony Remote that I have read about.

About the only issue that I am concerned about... is College Football, and I believe that this may be the last season that the cards will be held by Cable broadcasting. I really don't watch much other sports, and talking heads have never been too appealing... save for John Stewart..., so most of TV is a wasteland for me. I feel cheated when I spend my time watching anything that is not REALLY interesting and meaningful (Netflix reviews, versus first run blockbusters).

So, from a non-media maven, which just might actually be a majority... who knows? I am an occasional viewer of TV and I want to keep it that way, thank you very much. I want some choice, but don't need everything... I like my food apps better than Food Channel. I like to spend my time in creative pursuits: paint, draw, photograph, write and read... (oh, yeah... a lot of those activities are done on my mac, or iphone, or iPad, but NOT always for any of them). I look forward to an APPLE TV, as it will complement and simplify my minimalistic entertainment feeds.

Another way would be via third-party apps and an Apple TV App Store. I'm sure there are other approaches as well.

I would be very, very surprised if we didn't see that within the next year or so. Apple has made a practice of doing a lightweight version of something and then building it out over time. The iPod didn't have iTunes Store for years; the iPhone didn't have an App Store for awhile either. I would be absolutely shocked if we didn't see an Apple TV Store or summat by this time next year.

Moreover, I bet there is latent ability in the thing to run games ("apps") too. The Wii showed that there was a market for cheaper and simpler, and the iPhone ecosystem is going like gangbusters on that software model. Could they bootstrap Apple TV into that? If they did, do you think people might buy it?

Start small and accumulate over time. Apple has been doing very well with that model.

About the only issue that I am concerned about... is College Football, and I believe that this may be the last season that the cards will be held by Cable broadcasting. I really don't watch much other sports, and talking heads have never been too appealing... save for John Stewart..., so most of TV is a wasteland for me. I feel cheated when I spend my time watching anything that is not REALLY interesting and meaningful (Netflix reviews, versus first run blockbusters).

That's what friends and/or sports bars are for. Promise the guys that you would be watching with that you'll bring some beer and snacks and I'm sure they'll welcome you with open arms. (Most friends would welcome you without the inducement, but it's nice to be polite.)

Everything else can fall into place. I don't see this device as the total solution, nor should it be. I see it as an IP to TV adaptor - and for that it is exactly what it should be, next to nothing. We have the A4 and a way to get internet bits to the TV screen. Everything else is secondary.

I also think the price is right so that it it is now an impulse purchase.

Currently I have an HDTV with an HDMI cable hanging off the back of it and then like 3 HDMI to computer adaptors. When I want to show photos that are on a laptop on the TV it is a big geeky transition with me sitting in front of the TV and moving trying to advance the show on the tethered laptop and trying to stay out of the way. This AppleTV with AirPlay solves this problem quite nicely. So now I am on the couch and can control the show more easily. Great. That is worth $100 right there.

Renting movies is also a cool use. As is YouTube and Netflix. These are good solutions.

Over time I would like to see the device expand to live tv but this is a good start. It's a beachhead. Not the total solution.

I also think that once you have this device on your TV there is an opportunity to connect to other devices in the home or in the cloud that provide the total solutions that the writer is hoping for. Maybe Tivo makes a home server that can stream broadcast content to AppleTVs, laptops and iPad's all over the house. Cable to Tivo, IP for the rest. That would be a really cool solution. I don't really want my DVR tied to one display, I want that content available to all my devices.

So i think this is a good first step and the price is right to get a foot hold for the next step.

The solution is a device that is unabashedly omnivorous. Yes, in traditional Apple fashion, it must provide a simple, elegant, user interface. But behind the scenes, it must be willing and able to accept content from as many sources as possible. This is what makes the device valuable and desirable: dealing with and hiding all this complexity!

Is this show on cable? Satellite? Downloaded from the Web? Streamed from Netflix? Is it on my Mac? My iPhone? Does it need to be transcoded? Upscaled or downscaled? These are the things geeks deal with manually right now, and regular people have little chance of figuring out. People will pay for a device that will handle all of this for them. It might take a while, but word would get around about the new device that actually makes your living room less complex, for a change. One box to rule them all.

That is no solution at all. I don't buy it for a second that consumers will line up to pay for and subscribe to Cable, Satellite, Netflix, and also buy or rent stuff through iTunes, Amazon, and other sources if only they all worked behind a unified interface. No unified interface is worth several hundred dollars in fees to get service from all these vendors.

People already subscribe or otherwise pay for one or more sources of content. That was the point of the part about the dad being obsessed with that one cooking reality show and so on. (Sports is another good example, brought up by commenters, of content that fans already get in some way, and that's usually locked up tight in existing contracts.) People already pay for the content they want, in one form or another. Yes, Apple can offer some of the same content for a different price or in a different way (i.e., rentals), but since Apple (or anyone, really) can't offer all the content available elsewhere, the only way to avoid adding to the giant mess attached to the TV is to choose to unify all the existing content sources (including Apple's own) under a single interface. That is just about the only thing that would be worth "several hundred dollars" (though the actual price of the hardware could be much lower with more creative business arrangements with content owners or a clever use of server-side computing power and storage).

They can offer the same content, but not the same quality.

With AppleTV locked at 720p, and having to compress their streams even more than cable -- even using a more efficient codec -- their quality does not touch the full 1080i cable streams. I've compared iTunes DLs and 1080i cable caps, on many shows, and the Cable always wins. Even on Disney 720p content, it's significantly better on Cable than iTunes delivered (played on the same TV).

The biggest problem is the 720p limitation in a world of 1080p TVs (yes, there are some 720p sets still selling, mainly for cheap HDTVS, but that market continues to dwindle). The second issue is the noticeable loss of quality in (even more) overcompressed streams.

Did you mention the 720p limitation in your article? I didn't see, and it's definitely a major issue that should have been addressed (if you did and I missed it, my bad!).

Quote:

And don't get me started on TrueHD audio playback. (whatever 'HD' means in regards to audio)

In this case, TrueHD is Dolby's trademark for a high-rate, lossless audio codec. HD in audio means higher sample rates than CD.

It's similar to 720p and 1080p meaning HD (a higher resolution than Standard Definition 480i/p). "HD" audio signifies lossless audio at different sample rates, but they can be equal to or significantly higher than "Standard Definition" CD, and up to 7.1 channels. Though I think the name is more in reference to DVDs... The lossless TrueHD, DTS-MA, and LPCM formats are significantly better than lossy Dolby Digital on DVD.

I dont see why this has to solely be relegated to Apple. Why is it that Apple has to "Save" us from the chaos and complexity? This kind of TV revolution could also include the Xbox, PS3 and GoogleTV. They all have access to Netflix and their own marketplaces. Yes they all need some more work, especially GTV since its still being sketched out but I wouldnt want just Apple controlling the TV Landscape. I know that its a wonderful thing to have one place that sells it all but after a while, after its competitors die out or dwindle it could spell out problems for the consumer.

One company having all the power is never the solution. I think a set of marketplaces from a few major places should traverse this field. I mean allow for even the smaller players to be involved and not be shoved out but have main players like Google, Apple, Sony, Microsoft, Amazon, Netflix, TV Networks etc. to be networked and have 4-5 major set-top boxes that have all your content nicely laid out for you and easy to access.

It doesnt just have to be one company that controls it all because they are our one and true savior, thats just ludicrous and that goes for Apple, Google, Sony, Microsoft, Amazon, Netflix, Cable Companies and so on.

I also think that once you have this device on your TV there is an opportunity to connect to other devices in the home or in the cloud that provide the total solutions that the writer is hoping for. Maybe Tivo makes a home server that can stream broadcast content to AppleTVs, laptops and iPad's all over the house. Cable to Tivo, IP for the rest. That would be a really cool solution. I don't really want my DVR tied to one display, I want that content available to all my devices.

So i think this is a good first step and the price is right to get a foot hold for the next step.

Brilliant! That is such a good point. The iPod/iPhone/iPad line of products has spawned a whole ecosystem of add-on products that further improve the experience for individual needs/wants. Assuming that the new AppleTV sells well I'm sure there will be third parties who will be excited to ride the wave. In a sense some of those products already exist. I have an iOmega NAS drive that has all my iTunes content on it already. With the new AppleTV I can use that to stream all of my content to my home theater cheaply and easily. Software that transcodes content on the fly from a Mac or PC to the AppleTV can't be far behind. There are lot's of possibilities.

Apple TV has been a persistent loser from a company that usually only tolerates winners. With the latest iteration of the product, Apple hopes to change its fortunes. But is it still barking up the wrong tree?

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John, you are just wrong on this one. This is the Apple TV for which I've been waiting.

Nonsense. You're just a blithering fanboy.

There was nothing keeping Apple from bringing Netflix to the old AppleTV. The bulk of this release is just a seemingly gratuitous platform change and a price drop. For the most part, it's just more of the same. At a technical level, it is more of the same even if "consumers" can't see it.

And you are a jaded cynic. How do I know? Because I am anything but a fanboy. This is a simple case of the hardware meeting my needs at a price I'm willing to pay. It could have been and was Microsoft for a while. So, what do you have to say now? Exactly.